When Is This Possible Proprty Crash

[barrella]

I hope this is the right place to ask this question?

Also I am sure that I am going to get some replies like “how long is a piece of string” or “maybe be better to read the tea leaves”

The misses and I are looking at buying some more land/large houses in the suk area but I have this feeling that there might be a huge crash in the Thai housing market soon so I am trying to persuade her to wait.

Is this the common thought with others and if so any wild stab in the dark when this might happen?

Thanks

[quiksilva]

The owners of most large land parcels and houses along Sukhumvit tend to have owned their house for generations, and most of these folks are very well heeled.

In my experience this group would rather wait for the market to catch up with their expectations on value rather than sell below what they think it is worth.

Perhaps some will be affected by the gloomy economic climate but I expect they will be in the minority, and even then you'd have to wait for them to start defaulting on loans and for the pain to really start biting deep. This could be well over a year away.

This is what happened in 1997, when 56 finance companies and banks failed in this country, which I maintain was much worse for Thailand than today's market.

You are more likely to find a better deal in condominiums which have seen a sharp drop off in transactions recently.

[bkkjames]

A little off-topic but not sure this is worth a seperate thread, but I am sure everyone is familiar with that eyesore from the 90's next to Nana BTS station on Soi 6.

Well, I have notice a few things going on there recently and would like some input.

For the last few years, the area surrounding this shell has been used by the local street vendors to store their carts at night.

Over the last week and culminating today, they have all been removed and a permenent gate has been put up to basically keep them out. They have also started to clean up the area including trimming trees, new hoarding etc.

Is this a sign that someone has bought this land and had plans to do something with it or just an attempt to get rid of the vendors. There are two big signs in Thai on-site but I can't read Thai.

Cheers

[glyph]

"The misses and I are looking at buying some more land/large houses in the suk area but I have this feeling that there might be a huge crash in the Thai housing market soon so I am trying to persuade her to wait."

"The misses". I love it, it's about ownership, similar to "the cat", the dog", "the car"..."the misses". Since you are going to be spending your money, I'm not sure that "the misses" really cares if you spend too much or not. On the other hand, TVers have been waiting patiently for five years for BKK real estate prices to crash...and they only keep going up.

[barrella]

"The misses". I love it, it's about ownership, similar to "the cat", the dog", "the car"..."the misses". Since you are going to be spending your money, I'm not sure that "the misses" really cares if you spend too much or not. On the other hand, TVers have been waiting patiently for five years for BKK real estate prices to crash...and they only keep going up.

Well I am one of the few lucky ones. My misses is a lot richer than I am.

Yes she will own the land but I am not spending a penny of my own cash.

The way we think is we are in this as a team.

We are very happy together and I have no reason to think that the money train I am sitting on will stop but if one day she ran out of mommy and daddy money then I hope me, the night is shinning armor can step up to the challange.

I have my own businesses that are doing well, bad as in down this last 3 months but still making at present and my money has been going into UK real estate which my misses has also helped me purchase the last one. I know the UK market is down but we are in this for the long term.

If I was to buy into anything here with my own cash as in Thai real estate and I moaned about myself not being on the papers I would look like an ass as she has put money in property that is in my name in the UK.

On the other hand I know of millions of horror stores of guys giving there life savings for a plot and a house up north and once the papers are signed its all over. Little lady Thai has a nice new house and her real boyfriend moves in.

So back on topic, If there is land we want to buy in the lower suk area then buy do not wait as it is not going down?

[pkrv]

"The misses". I love it, it's about ownership, similar to "the cat", the dog", "the car"..."the misses". Since you are going to be spending your money, I'm not sure that "the misses" really cares if you spend too much or not. On the other hand, TVers have been waiting patiently for five years for BKK real estate prices to crash...and they only keep going up.

Well I am one of the few lucky ones. My misses is a lot richer than I am.

Yes she will own the land but I am not spending a penny of my own cash.

The way we think is we are in this as a team.

We are very happy together and I have no reason to think that the money train I am sitting on will stop but if one day she ran out of mommy and daddy money then I hope me, the night is shinning armor can step up to the challange.

I have my own businesses that are doing well, bad as in down this last 3 months but still making at present and my money has been going into UK real estate which my misses has also helped me purchase the last one. I know the UK market is down but we are in this for the long term.

If I was to buy into anything here with my own cash as in Thai real estate and I moaned about myself not being on the papers I would look like an ass as she has put money in property that is in my name in the UK.

On the other hand I know of millions of horror stores of guys giving there life savings for a plot and a house up north and once the papers are signed its all over. Little lady Thai has a nice new house and her real boyfriend moves in.

So back on topic, If there is land we want to buy in the lower suk area then buy do not wait as it is not going down?

Personal note - I loved the reply - sorry can't assist on land/house stuff we are a farang/farang 'team' and as such in condos

[vrsushi]

OP it's Mrs not Misses. Talking about "the misses" I thought you were a footballer or something. Still, fair play to you, your making a lot more money than me by the sounds of it.

[dotcom]

I personally believe that any "crash", if one comes, would mostly be at the high end. You know people who buy condos on spec with no intention of ever closing on them or living in them but rather "flipping" them to the next bigger idiot (speculator) comes down the pike. They will try & sell as completion draws nearer.

You forgot to mention your budget.

Experts on here can tell you what raw land sells for in Silom or Sukhumvit.

The building on the land is valued at zero.

Unlike in the west where houses & plots are bought on borrowed money, here these things have been in families for generations.

I think about the families who own Nana PLaza & Washington Square,

Their land values would drop if they were forced to sell during a downturn (such as now). But they will hold out for top dollar.

I can assure you that the condo I rent - valued at 31,250 per meter is not going to go down.

"Value" is a nebulous concept. The seller is asking X. Buyer is willing to pay Y. Somewhere in the middle is the "value".

Edited October 16, 2008 by dotcom

[pkrv]

I personally believe that any "crash", if one comes, would mostly be at the high end. You know people who buy condos on spec with no intention of ever closing on them or living in them but rather "flipping" them to the next bigger idiot (speculator) comes down the pike. They will try & sell as completion draws nearer.

You would be surprised at how few and far between such projects are. Unfortunately it would be Thais who would be most badly burnt if this were to happen. I am only aware of two new high end condominium projects in progress (in Bangkok) at this time. Most others have completed and some have already had their AGM.

But this thread is about land/houses not my area.

[LennyW]

You might find that with many people taking their money out of the tumbling stock markets, they will then re-invest in PROPERTY!!! therby maintaining current prices or even giving prices a bump up the way???

[pkrv]

You might find that with many people taking their money out of the tumbling stock markets, they will then re-invest in PROPERTY!!! therby maintaining current prices or even giving prices a bump up the way???

Yep - there is a debate on this on the finance forum

http://www.thaivisa.com/forum/Cash-Saving-...ut-t217415.html

and an interesting historical parallel - link courtesy of thaihome

http://en.wikipedia.org/wiki/1920s_German_inflation

[barrella]

You might find that with many people taking their money out of the tumbling stock markets, they will then re-invest in PROPERTY!!! therby maintaining current prices or even giving prices a bump up the way???

As a not so smart guy in this area this was more my thinking.

Which is why I started asking on this forum either hoping for 10000000 posters telling me I am a fool and then the flame war starts or posters coming out the woodwork confirming this.

It's still playing on my mind us buying some land that I think is well overpriced but it is prime land for sure. I just could not live with the idea of us shelling out a load of cash and then 1 year later is halves.

Anyway thanks for all your input guys.

If I knew you all I would buy you a beer.

[bkkjames]

You might find that with many people taking their money out of the tumbling stock markets, they will then re-invest in PROPERTY!!! therby maintaining current prices or even giving prices a bump up the way???

As a not so smart guy in this area this was more my thinking.

Which is why I started asking on this forum either hoping for 10000000 posters telling me I am a fool and then the flame war starts or posters coming out the woodwork confirming this.

It's still playing on my mind us buying some land that I think is well overpriced but it is prime land for sure. I just could not live with the idea of us shelling out a load of cash and then 1 year later is halves.

Anyway thanks for all your input guys.

If I knew you all I would buy you a beer.

This sounds like a much smarter investment IMO.

[barrella]

If I knew you all I would buy you a beer.

This sounds like a much smarter investment IMO.

But maybe not BKKjames as he is a man U supporter.

[Burgernev]

Can anyone explain to me why there will not be great deals possibly coming up when the pinch is really on, for condos where the block is say 50-60% sold and new buyers are few and far between for remaining units.

Will it not be the case for the condo developers, that are not seriously cash rich, that as the building progresses they would normally be relying on the remanining units customer funds to finance the completion ?

What would happen in this situation, cheap units, work stop for years, they borrow money from bank and finish it off even though loads of unsold units ?

Cheers,

Edited October 17, 2008 by Burgernev

[barrella]

Can anyone explain to me why there will not be great deals possibly coming up when the pinch is really on, for condos where the block is say 50-60% sold and new buyers are few and far between for remaining units.

Will it not be the case for the condo developers, that are not seriously cash rich, that as the building progresses they would normally be relying on the remanining units customer funds to finance the completion ?

What would happen in this situation, cheap units, work stop for years, they borrow money from bank and finish it off even though loads of unsold units ?

Cheers,

I think it is more because I am not asking about condo's I am asking about land with property on it. I agree (from what I have read and learned on here) that condo's will have a great buyers market sooner or later here but the land situation, I am not so sure about.

[Burgernev]

Yeah Barella your OP is about land/house, sorry I'll put my post in a condo thread where more approriate.

Good luck with your hunt.

Cheers,

Edited October 17, 2008 by Burgernev

[PattayaParent]

Can anyone explain to me why there will not be great deals possibly coming up when the pinch is really on, for condos where the block is say 50-60% sold and new buyers are few and far between for remaining units.

Will it not be the case for the condo developers, that are not seriously cash rich, that as the building progresses they would normally be relying on the remanining units customer funds to finance the completion ?

What would happen in this situation, cheap units, work stop for years, they borrow money from bank and finish it off even though loads of unsold units ?

Cheers,

Because when the developer has sold 50% of the units he's already recoverd his costs so anything more is all in his pocket and he'll want to maximise his profit.

[Burgernev]

Can anyone explain to me why there will not be great deals possibly coming up when the pinch is really on, for condos where the block is say 50-60% sold and new buyers are few and far between for remaining units.

Will it not be the case for the condo developers, that are not seriously cash rich, that as the building progresses they would normally be relying on the remanining units customer funds to finance the completion ?

What would happen in this situation, cheap units, work stop for years, they borrow money from bank and finish it off even though loads of unsold units ?

Cheers

Because when the developer has sold 50% of the units he's already recoverd his costs so anything more is all in his pocket and he'll want to maximise his profit.

I'm surprised the profit margin is 50%, nice if it is.

But when 50% are sold they only have half the deposits, the units need to be finished to get the further payments in. Also many that are sold are the popular penthouses etc, the final monies from them doesn't come in until the last knockings I would have though.

Cheers,

[jackyseymour]

There. Is. Not. Going. To. Be. A. Thai. Property. Crash.

[pkrv]

Can anyone explain to me why there will not be great deals possibly coming up when the pinch is really on, for condos where the block is say 50-60% sold and new buyers are few and far between for remaining units.

Will it not be the case for the condo developers, that are not seriously cash rich, that as the building progresses they would normally be relying on the remanining units customer funds to finance the completion ?

What would happen in this situation, cheap units, work stop for years, they borrow money from bank and finish it off even though loads of unsold units ?

Cheers,

Because when the developer has sold 50% of the units he's already recoverd his costs so anything more is all in his pocket and he'll want to maximise his profit.

Concensus is 60% for break even - already heavily discussed.

[dotcom]

Hate to burst somebody's bubble but the developers BORROW the money to fund their projects from BANKS.

Get real.

[ray08]

Hate to burst somebody's bubble but the developers BORROW the money to fund their projects from BANKS.

Get real.

I beleive that a lot , use the deposits ,and progress payments from the investors to fund projects ,if they were all using

pre-approved bank funding we would not see so many unfinished projects.

[quiksilva]

They were able to get 100% construction loans providing they had recorded 60% sales off plan (i.e. contracts signed, deposit paid).

[midas]

I have said it before and I will say it again ( on the day that

China announced lower growth )...............this must surely impact the

property market in Thailand eventually

These paragraphs are taken from todays The Times of London :-

What is to be done? As a result of the global banking meltdown that began in the second week of September, the world economy has plunged into recession.

Such a catastrophic collapse is a real threat. Only a handful of economic statistics relating to the post-Lehman period have been published so far, but they show record-breaking falls in consumer spending, industrial output and housing — and anecdotal evidence suggests that much worse is to come. One typical comment: “The real collapse has not even started because banks were waiting to be recapitalised before they put their overleveraged borrowers into liquidation. There will be a tsunami of commercial properties foreclosures and private equity bankruptcies in the first quarter of next year.”

[dotcom]

All of you who think the speculators in Dubai are quaking in their boots raise your hand.

Congratulations. You got it right. Castles made of (& built on) SAND.

1997 was the last correction in the Thai property market.

On another related thread (when is the crash coming?) a guy told a story about prices in MTT in 1996/97.

Great deals on a piss poor location.

So chicken little is right - it's merely a question of when.

There are good deals to be had for those who want to live in the units. I saw a beautiful 2 br 2 bath - fully furnished 100 m2 condo today listed for 3.2 million.

Speculators: I hope you get your a$$es ripped.

[bkkjames]

All of you who think the speculators in Dubai are quaking in their boots raise your hand.

Congratulations. You got it right. Castles made of (& built on) SAND.

1997 was the last correction in the Thai property market.

On another related thread (when is the crash coming?) a guy told a story about prices in MTT in 1996/97.

Great deals on a piss poor location.

So chicken little is right - it's merely a question of when.

There are good deals to be had for those who want to live in the units. I saw a beautiful 2 br 2 bath - fully furnished 100 m2 condo today listed for 3.2 million.

Speculators: I hope you get your a$$es ripped.

Because you won't tell us what grade b project this is, I will assume it's in Pink Lao or somewhere as convenient to the cbd

[pkrv]

I agree a figure out of the blue is meaningless. Where? The market is simply too fragmented. Sorry to the OP you were asking about land/house issues. We are back on condos because the thread title is about property.

[steveromagnino]

I agree a figure out of the blue is meaningless. Where? The market is simply too fragmented. Sorry to the OP you were asking about land/house issues. We are back on condos because the thread title is about property.

I bought a 2 bedroom for 27k per sqm 3 years ago. Totally meaningless to compare it to a 200k per sqm place as the quality and location are a mile apart.

If I tried to sell 6 months ago, would have probably got about 45k. Right now? Probably still could get 45k.

Speculators aren't the worst thing; they provide liquidity to the market; MTT was always going to be a bit questionable in the middle of nowhere; nowadays not sure where the question marks are, but can't see the condo market going down much for the prime locations.

[Livinginexile]

"The misses". I love it, it's about ownership, similar to "the cat", the dog", "the car"..."the misses". Since you are going to be spending your money, I'm not sure that "the misses" really cares if you spend too much or not. On the other hand, TVers have been waiting patiently for five years for BKK real estate prices to crash...and they only keep going up.

Well I am one of the few lucky ones. My misses is a lot richer than I am.

Yes she will own the land but I am not spending a penny of my own cash.

The way we think is we are in this as a team.

We are very happy together and I have no reason to think that the money train I am sitting on will stop but if one day she ran out of mommy and daddy money then I hope me, the night is shinning armor can step up to the challange.

I have my own businesses that are doing well, bad as in down this last 3 months but still making at present and my money has been going into UK real estate which my misses has also helped me purchase the last one. I know the UK market is down but we are in this for the long term.

If I was to buy into anything here with my own cash as in Thai real estate and I moaned about myself not being on the papers I would look like an ass as she has put money in property that is in my name in the UK.

On the other hand I know of millions of horror stores of guys giving there life savings for a plot and a house up north and once the papers are signed its all over. Little lady Thai has a nice new house and her real boyfriend moves in.

So back on topic, If there is land we want to buy in the lower suk area then buy do not wait as it is not going down?

Here we go again...

Why do these guys need to get their self esteem by bulldusting on public forums??

"My Thai wife is a multi millionare and we need help to decide to buy in Thailnd"...blah blah blah